3 Underrated Stocks That Just Hit Goldman’s Hedge Fund VIP List

Cheniere Energy, Inc. (NYSEMKT:LNG)

Hedge funds have been overweight Cheniere Energy, Inc. (NYSEMKT:LNG) for years, so its addition to Goldman’s list isn’t a big surprise given the improving outlook for energy stocks in the first-quarter. While Cheniere won’t benefit from rising oil prices like many other energy plays, it has benefited from robust LNG spot prices, which carried it to outstanding first-quarter results, as revenue rose to a record $2.24 billion, obliterating estimates by more than $500 million. Fears that LNG prices would collapse under the weight of too much supply (chiefly from Cheniere itself) have been incorrect to this point, which makes Cheniere’s aggressive expansion efforts look all the more appealing.

Billionaire investors Carl Icahn and Seth Klarman have each held large positions in Cheniere for over two years, while John Horseman’s Horseman Capital Management and Perella Weinberg Partners’ Xerion strategy, were among the funds to add Cheniere to their portfolio’s top-10 holdings during the first-quarter.

Worldpay Inc (NYSE:WP)

Hedge funds were clearly bullish on the merger between Vantiv Inc. and Worldpay, which was completed in the middle of January, as hedge fund activity during that quarter shot the merged company onto the Goldman VIP list.

Early returns suggest they were correct, as Worldpay delivered strong quarterly results for the first time as a combined entity, beating revenue and earnings estimates and raising its 2018 estimates for both figures. Co-CEO Charles Drucker stated that $10 million in cost synergies have already been realized thanks to the merger, which is expected to be fully integrated by the first-half of 2019.

Interestingly, the newly-merged Worldpay Inc (NYSE:WP) may not last long in its new form, as it has been cited as a potential acquisition target of JPMorgan Chase & Co. (NYSE:JPM), which had looked into buying Worldpay last year before the company struck its deal with Vantiv. Worldpay Inc (NYSE:WP) shares were held by 46 of the funds within Insider Monkey’s database as of the end of 2017, with those funds owning 19% of the company’s shares.

Disclosure: None